(Reuters) -India’s LIC Housing Finance beat fourth-quarter profit expectations on Thursday, helped by healthy asset quality and lower provisions.
The non-banking finance company’s (NBFC) profit after tax came in at 13.68 billion Indian rupees ($160 million) for the January-March period, compared to analysts’ average estimate of 13.49 billion rupees as per data compiled by LSEG.
Over recent quarters, LIC Housing has witnessed an improvement in asset quality, leading to reduced funds allocated for bad loans, boosting its profitability.
The company’s asset quality improved, with gross stage 3 assets ratio, or loans that are overdue for more than 90 days, declining to 2.47% for the quarter from 3.31% a year earlier.
Provisions for bad loans decreased significantly to 1.09 billion rupees from 4.28 billion rupees the previous year.
LIC Housing Finance’s total loan disbursements grew 5% to 191.56 billion rupees.
However, the Mumbai-based company’s disbursements have been slower than its peers in last few quarters, with PNB Housing posting a 23% rise in fourth-quarter disbursements last month.
LIC Housing Finance’s net interest income, the difference between interest earned and paid, fell 3% to 21.66 billion rupees.
Its net interest margin rose to 2.86% from 2.7% in the previous quarter, though down from 3.15% a year earlier.
($1 = 85.4450 Indian rupees)
(Reporting by Nishit Navin and Nandan Mandayam; Editing by Varun H K and Tasim Zahid)
